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The Good, The Bad & The Ugly – Week of 10/22/12

The regulatory picture is changing so rapidly that there are far more events than we can develop formal comments on. That doesn’t mean they should escape without notice. This post inaugurates a weekly roundup of events related to financial regulation that we believe are worth celebrating, as well as those we think merit a Bronx cheer.

The Good

US Attorney Preet Bharara files a civil fraud complaint against Countrywide/Bank of America for its fraudulent “Hustle” origination program, through which the lender is alleged to have offloaded $3 billion in garbage securities to investors who had been told the loans were conforming. NY Times, 10/24/12

No wonder we’ve seen so few prosecutions: “US attorney offices from California to Connecticut have hired ‘uncompensated special assistant US attorneys’ since a department-wide hiring freeze was announced in January 2011.” Financial Times, 10/25/12

Senators Merkley and Levin send an admonishing letter to the chief banking regulators criticizing their delays in finalizing the Volcker Rule writing: “While we are cautiously pleased to see reports that a consensus is emerging, we are concerned that some ongoing staff-level differences may be obstructing progress. The time for resolving those differences is long overdue.” Firedoglake 10/24/12

The Ugly

The media falls in line behind finance in attacking Greg Smith for his expose of the culture at Goldman Sachs. Per Jesse at Cafe Americain, “The media are working from the talking points memos released by Goldman, and a growing cultural disposition against whistleblowers as being inherently disloyal malcontents.” More at Jesse’s blog here (h/t Yves at Naked Capitalism). 10/22/12

Simon Johnson alerts us to the formation of the Financial Regulatory Reform Initiative of the Bipartisan Policy Center. It’s members will likely have an influential voice in the continuing efforts to weaken financial regulations. NYTimes 10/25/12